Japanese travel and shopping company Rakuten plans to buy Ebates a part of the company’s rapid expansion.
Rakuten Inc. has announced of its plans to purchase U.S. based cash-back site Ebates for $1 billion. This is Rakuten’s part of a series of acquisitions of international companies which is aimed at fulfilling the company’s long time goals and that is to create “world’s largest product line-up.”
Rakuten has a variety of goods ranging from fashion accessories, pet products, toys and home accessories. Rakuten is currently the top Internet retailer in Japan. Over the years it has made numerous overseas acquisitions and these includes Cyprus-based Internet phone application Viber Media. It has also led to a $100 million investment in online scrapbook site Pinterest.
California-based Ebates and Rakuten have membership-based online shopping platforms. The process usually goes this way: retailers pay Ebates to advertise their products and then the company provides rebates for eligible purchases online.
Rakuten plans to purchase Ebates for 32.852 million shares, paid through cash, bank loans, bonds and commercial paper.
Hiroshi Mikitani, Rakuten founder and president has developed his company through a rapid expansion in the past years. Mikitani calls this a “Rakuten eco-system” consisting of a variety of services from banking and credit cards to life insurance and telecommunications.
Recent announcements have mentioned that the company has outgrown its offices in Shinagawa, Tokyo which is considered the country’s high-tech zone. Plans of new offices have been mentioned and these will be in Futako-Tamagawa.
Aside from this latest purchase by the company, Rakuten Inc., Japan’s largest e-commerce company, has been considering a service similar to the website Airbnb. This will provide a hub to rent apartments and homes in the country for short-term guests.
This move is in line with the government’s promotion of tourism to boost the economy. Japan has set a target of 20 million visitors a year by 2020. This is the year Tokyo hosts the Olympics.
Current regulations on the other hand are defiant when it comes to servicing tourists for less than a month. In Japan, personal property to tourists could also be dangerous. In recent news, a British man was arrested because he does not have the right permits or papers to rent his place out. Reports also mention that the Japanese government is expected to ease these laws. These would help Rakuten in its future goals. This global phenomenon has turned Airbnb, a San Francisco-based privately owned company into a prosperous company now with a market value of $10 billion.
Rakuten is an electronic and Internet company that is based in Tokyo, Japan. Rakuten Shopping Mall started operations in May 1997. The Japanese word rakuten means optimism. In 2012 the company showed an increase in revenue with a total of US$4.6 billion with operating profits of about US$244 million. In June 2013 there are 10,351 employees all over the world.
In 2005, acquisitions and joint ventures of different international companies was the focus of Rakuten. The company has the following major acquisitions all over the years:Buy.com (now Rakuten.com Shopping in the US), Priceminister in France, Ikeda now called Rakuten Brasil, Tradoria now called Rakuten, Play.com in the UK, Wuaki.tv in Spain, and Kobo Inc. in Canada. Pinterest, Ozon.ru, AHA Life, and Daily Grommet are companies where Rakuten is a major investor. Rakuten stock market evolution:
About Hiroshi Mikitani
Mr. Hiroshi Mikitani has a Harvard MBA and is a former banker. He is listed by Forbes as Japan’s 4th richest person with an estimated wealth at $7.7 billion. Mikitani has encouraged a more global way of doing business, and this is why Rakuten has an official corporate language which is English, in a policy dubbed “Englishnization.”
Ebates is known for online Cash Back Shopping. It was founded in 1998 by two Deputy District Attorneys in Silicon Valley that specializes in prosecuting online fraud & identity theft. Joining Ebates is always free. Members receive promos and cash backs using different payment modes including PayPal, check or money to the customer’s favorite charity. Ebates stock market evolution:
Airbnb is a site that assists people in need of lodging. The company has over 500,000 listings in 33,000 cities and 192 countries. Airbnb was founded in August 2008. It is headquartered in San Francisco, California. The company is privately owned and operated by Airbnb, Inc.
As of July 2011, the company had raised $119.8 million in venture funding from Y Combinator, Greylock Partners, Sequoia Capital, Andreessen Horowitz, DST Global Solutions, General Catalyst Partners and undisclosed amounts from Youniversity Ventures’ partners, Jawed Karim, Keith Rabois, and Kevin Hartz. In April 2014, the company closed on an investment of $450 million by TPG Capital valued at $10 billion.